Cabinet received a report following the consultation on proposals for Council Tax Support for 2015/16 launched by a Cabinet Member Decision Notice on 2 December 2014 which had included a discussion at the Joint Budget Scrutiny on 3 December 2014.
The purpose of the report was for Cabinet to make a recommendation to Full Council on the Council Tax Support Scheme to be implemented in Peterborough from April 2015.
Councillor Seaton introduced the report and highlighted the main issues contained within.
Cabinet debated the report and key points raised and responses to questions included:
· There would be approximately 11,000 households throughout Peterborough affected by the proposals;
· It had been extremely difficult to obtain Council Tax feedback in recent years, 4,000 letters had been sent out and feedback was relied upon from partner,s such as the Citizen’s Advice Bureau;
· The Police and Fire Services would also face a shortfall if a scheme was not introduced; and
· The scheme was not ideal, but was required. No increase was advocated at the current time, with the scheme being kept under close review going forward.
Cabinet considered the report and RESOLVED:
1. To note the feedback received to date on the consultation on proposed changes to the council tax support scheme, including the updates tabled at the meeting; and
2. To recommend that Council agree the Local Council Tax Support Scheme for Peterborough, including the level of reduction in benefit for working age claimants, for which Cabinet recommended that the reduction be kept at 30%.
REASONS FOR THE DECISION
The Constitution required the Cabinet to approve the draft Council Tax Support scheme for consultation.
ALTERNATIVE OPTIONS CONSIDERED
1. No change and keep council tax support at a 30% reduction
For Peterborough this would result in an additional pressure of around £1m and savings to be made from elsewhere in its budget. This could also affect the services provided by our Fire and Police Authorities as over 17% of the council tax that is collected is distributed to these preceptors.
If the Council were to absorb the deficit, it would then have to find savings elsewhere in the budget due to the limited amount of resources available to run all Council services. Given the reductions in grant the Council was facing, further reductions of £1m would have a significant impact.
The Council had released its first phase of budget proposals for 2015/16. Respondents to the CTSS consultation would be encouraged to review the budget proposals to determine whether they would prefer changes to CTSS, or additional savings to be found elsewhere in the Council budget.
2. Design a local scheme to deliver £1m savings – a 50% reduction
To reduce all CTB equally - as the Government had made clear that pensioners must be protected, the whole of this shortfall would need to be met by working age claimants. As a result, to meet the £1m funding shortfall, the reduction would need to increase from 30% to around 50%.
3. Somewhere in between
As with the option of ‘no change’, absorbing any deficit from a shortfall in funding would impact on the services that the Council currently delivered, but would mean a lesser impact on benefit recipients. Options to be considered could include further reducing council tax support:
· From 30% to 35% to save £0.25m (and £0.75m being found elsewhere in the council’s budget)
· From 30% to 40% to save £0.50m (and £0.5m being found elsewhere in the council’s budget)
The Council had previously considered other changes, for example, introducing a maximum or minimum level of support. These had been rejected as they made the scheme more complex and generated little saving. As such the straightforward overall reduction was maintained for any changes.